A PROPERTY website said today it had doubled its forecast for house price growth during 2004, following renewed demand from potential buyers.

Hometrack said it now expected the cost of property in England and Wales to rise by eight per cent during the year, up from the four per centit predicted in December.

The group said prices rose by 0.7 per cent during March as the number of people looking to buy a new home continued to increase.

The rise in prices, which followed a jump of 0.9 per cent in February, puts the average cost of a house at £149,800.

Hometrack said during March the number of properties being put up for sale rose by 4.2 per cent, but this was outstripped by the 6.5 per cent increase in new buyers.

It said the figures showed that demand continued to outweigh supply, suggesting there would be further strong price rises in the coming months.

John Wriglesworth, Hometrack's housing economist, said: "The housing market this month has strengthened, with strong house price rises across the whole country.

"Demand by new buyers is outweighing supply and the upward pressure on house prices continues.

"Low interest rates remain, and despite prospects of rises this year, buyers are not being deterred from borrowing even higher multiples of their incomes to afford their desired homes."

The group said all 52 county areas in England and Wales saw price rises during March, But growth continued to be strongest in northern regions.

North Teesside led the way with a 1.5 per cent increase, followed by Northumberland and Tyne and Wear at 1.2 per cent, and Cumbria and North Yorkshire at 1.1 per cent, while Bath saw the biggest price jump for a city, with the cost of homes rising by 2.4 per cent.

Homes are now selling for an average of 96.2 per cent of their asking price, up from a low of 94.2 per cent in June last year.